Pyne Gould taps former journalist as independent director

BUSINESSDESK: Pyne Gould Corp - engulfed in speculation as to why its auditor quit suddenly yesterday - has appointed a former journalist in Australia as independent director to meet its statutory requirements after an NZX waiver ran out this week.

Gregory Bright, a former economics reporter at the Sydney Morning Herald, will join the audit committee of Pyne Gould.

The company was reduced to one independent director, chairman Bryan Mogridge, when Bruce Irvine left the board in January.

Pyne Gould gained the waiver in February, arguing that it was difficult to find someone to act as independent director when the company was under takeover offer by businessman George Kerr.

His Australasian Equity Partners No 1 LP (AEP) venture with US hedge fund Baker Street Capital secured 76% of the company in a 37-cents-a-share takeover bid that closed in March.

Mr Bright is chairman of his own conference production company, Binalong Advisory Services, Pyne Gould says.

Mr Kerr had wanted to take the company private and as AEP took control there has been an exodus of executives, led by managing director John Duncan.

Mr Kerr replaced Mr Duncan with immediate effect.

Today, the Financial Markets Authority said it was looking into Pyne Gould’s related party transactions, which along with complaints about the wealth manager's governance, prompted auditor KPMG to quit its role with the company this week.

The market watchdog has "made inquiries over related party transactions involving PGC over the past two weeks", Pyne Gould said in a statement.

The wealth manager is cooperating with the FMA, but is unable to make any further comment, it said.

KPMG said it had “unresolved differences as to whether certain transactions should be disclosed as related party transactions, and concerns over the adequacy of governance and management of financial reporting”.

Pyne Gould has since appointed Deloitte to oversee its central accounting functions.

Mr Kerr became involved in Pyne Gould in 2009, taking a cornerstone stake after the company faced large writedowns on the value of its Marac finance unit's property loan book, which has since been divested.

Since his involvement, Pyne Gould has taken stakes in the Kerr-managed Torchlight funds, which specialise in squeezing value out of distressed assets, and its board approved increasing the capital available to Torchlight to “seek modest investments beyond the Torchlight fund”.

Pyne Gould's shares were unchanged at 32 cents today, and are 14% below AEP's takeover offer.

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9 Comments & Questions

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This guy needs his head read to become a director in these circumstances. Either he hasn't heard of Kerr or his career is stuffed and he desperately needs the cash. I guess in those circumstances better to become the bit<h of Kerr in NZ rather than sh:t in his own nest over there. At least if it all goes tits up it won't raise much media attention in Aussie.

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Total Stooge

Hope Kerr and PGC have given him a solid directors insurance policy and indemnities

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A former Fairfax Australia journalist joins beleagured company?

Well, I suppose if they have bad PR then bringing an ex journo on board might be compelling for the company.

Not so compelling to investors though, who would presumably be happier with a director who will stand up to strong personalities in the interests of minority shareholders.

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PGC another shining example to only invest in property and ASX listed stocks.

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A super lightweight who looks like he is the biggest poser on his profile!

Good luck, PGC minorities!

Alternatively, it's time for action against PGC becoming an entity riddled with related party transactions.

We all know what happened to SCF, don't we?

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Kerr and Mogridge are both commercial hazards.Anyone dumb enought to join a Board they are on deserves to get fried

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I am somewhat bemused by the commentary about my appointment. I don't consider myself a "stooge" and don't think I "need my head read". This may sound trite but I actually feel honoured to be asked to join the board of a 125-year-old company which is obviously going through a period of significant change. I will be doing my best to add value for shareholders, in particular in growing the Pyne Gould business outside New Zealand. If anyone's interested, you don't have to Google my name for background info - my contacts are: greg.bright@binalong.net or +61 (0) 417 241 440. Regards. Greg Bright

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Thanks, Greg, for fronting. An excellent departure from other directors who prefer to duck for cover at every negative opportunity.

What's your perspective on KPMG resigning over the related party transactions?

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http://www.linkedin.com/pub/greg-bright/6/101/557

Profile photo showing Greg sucking on a small cigar. Rather telling posture!

A small time George Soros type pretender if I ever saw one!

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